Self-Study

Development of Financial Strategy

Tuesday, May 1, 2018 – Tuesday, April 30, 2019

This CPE course identifies the three key decisions in financial strategy and looks at the links between them. These key decisions are:
? Investment - what projects should be undertaken by the organization?
? Financing - how should the necessary funds be raised?
? Dividends - how much cash should be allocated each year to be paid as a return to shareholders, and how much should be retained to meet the cash needs of the business?

These areas are closely interrelated. Investment decisions cannot be taken without consideration of where and how the funds are to be raised to finance them. Dividends represent the payment of returns on the investment back to the shareholders, the level and risk of which will depend upon the project itself, and how it was financed. This course explores such areas as the influence of external economic forces on financial strategy, the impact of taxation, and credit worthiness. It finally examines the repercussions involved when an entity changes its financing, investing, and dividend policy.

Objectives

Recognize the interrelationship between investment, financing and dividend decisions for an incorporated entity.

Recognize the impact of taxation and other external influences on the development of financial strategy.

Recognize the impact of investment, financing, and divdends decisions in meeting the cash needs of the entity, on future cash position, and on forecast financial statements.

Recognize the impact of changes in capital structure for an incorporated entity on shareholders and other stakeholders.

Highlights

Investment, financing and dividend decisions and the interrelationship between them in meeting the cash needs of the entity

Sensitivity of forecast financial statements and future cash position to investment, financing and dividend decisions

Considerations of the interests of shareholders and other stakeholders in investment, financing and dividend decisions

Determine financing requirements and cash available for payment of dividends based on the overall consideration of the forecast future cash flows arising from investment decisions, business strategy and forecast business and economic variables